Vancouver-based Methanex said Friday that Total has agreed to pay the money to Methanex Chile S.A. pursuant to a long-term natural gas supply agreement between the two companies.

Total will make a lump sum payment of US$42 million in order to terminate the agreement and settle all potential legal disputes, Methanex said.

“We are pleased to have reached an agreement with Total, and we believe that the settlement represents fair value for Methanex shareholders,” president and CEO John Floren said.

“We will continue to focus our efforts in Chile on realizing full value from our remaining assets including non-performing natural gas contracts. We have a first-class operation in Chile and remain optimistic that we can continue to operate in the region, supported by gas supplies from both Chile and Argentina.”

Methanex is the world’s largest producer and supplier of methanol to major international markets.

On the Toronto Stock Exchange, the company’s shares closed up 26 cents at $66 on Friday.